ProSiebenSat.1 Media SE

Ralf Gierig – Executive Vice President-Group Finance and Investor Relations Thomas Ebeling – Chief Executive Officer Gunnar Wiedenfels – Chief Financial Officer Jan Frouman – Chief Executive Officer-Red Arrow Entertainment Group Christof Wahl – Chief Operating Officer

Julien Roch – Barclays Laurie Davison – Deutsche Bank Adrien de Saint Hilaire – Morgan Stanley Lisa Yang – Goldman Sachs Marcus Diebel – JPMorgan Conor O’Shea – Kepler Cheuvreux Charles Bedouelle – Exane BNP Paribas Richard Eary – UBS Sonia Rabussier – Commerzbank Annick Maas – Liberum Capital Christopher Johnen – HSBC Catherine O’Neill – Citi

Good morning, ladies and gentlemen. Welcome to our Q4 and full year results 2016 conference call.

Today’s call as always, is hosted by Thomas Ebeling, our CEO. Thomas, together with our CFO Dr.

Gunnar Wiedenfels, will first lead you through the presentation, which was made available on our IR webpage via the download link we provided. The presentation will be followed by a Q&A session, which will be joined by our executive board members Christof Wahl, Conrad Albert, Jan Frouman and Ralf Schremper.

With this, I’ll hand over to Thomas.

Thank you, Ralf. Welcome ladies and gentlemen as well from my side.

I’ll start with the major highlights in Q4. Q4 was a very busy deal quarter for us.

We signed multi-channel network partnership with two major European broadcasters, TF1 and Mediaset. We extended our distribution agreement with Vodafone.

We signed an agreement to acquire the Austrian TV station ATV. Our team concluded successfully a new license deal for Bosch with Amazon.

We concluded a strategic data partnership with Zalando and we agreed with Scripps to launch some thematic branded windows on our German TV channels. This is building on an already very good track record for the first three quarters in 2016.

I think you are very familiar with all this, what we have done, so let’s move straight to the financials on the next page. 17% revenue growth and 10% growth of recurring EBITDA and underlying net income.

On the next page we’ll see how this is broken down by the different units, basically every unit is growing. The digital units and production clearly more dynamically than broadcasting, but broadcasting broadly in line with the market.

Fundamentally we have met our 2016 targets and the Group revenue was 17% higher than what we have originally aimed at. The German TV ad market was growing between around 2.5%, 3% possibly, we don’t have the final numbers, but it is the outlook we currently have.

Our ad revenues were slightly below the market and you know the reason was the sports year, that was a major driver. Our digital business has developed very nicely and we had another record year as it relates to recurring EBITDA and underlying net income.

With all of this, we are well on track to achieve our 2018 capital market day target. The degree of achievement is now slightly below 70%, so that’s pretty much in line with our expectations.

The next page is designed to show to you that we have several assets in our portfolio, which are forecasted to grow very dynamically both in terms of revenue and in terms of EBITDA. I think the high number of assets with dynamic growth potential is certainly very unique to a broadcaster and it shows that our portfolio is very balanced in terms of growth and is well-positioned for the future.

Our vision is recaptured on Page 10. I think on the next page you see that the combination of entertainment and commerce is our unique advantage, especially commerce sales and data will enable us to strengthen our TV advertising business and our competitiveness.

On the next page you’ll see our fundamental platform playbook: the combination of excellent TV ad inventory, sales and marketing excellence, coupled with a strong and attractive content library, supported in the future by a diversified and large data pool. And with powerful distribution platforms and synergistic value model supported by de-risked M&A, will deliver the platform for us to create in the future strong brands and to further diversify our business.

M&A will remain the key element of our strategy to enhance our organic growth profile. And on the next page, you see our current bolt-on M&A strategy.

In broadcasting, we will participate in intra-market consolidation as illustrated by the acquisition of the Austrian channel ATV. In content production, we did two deals in 2016 and will continue to build our presence in Anglo-Saxon markets.

In digital entertainment, we do whatever takes to support our competitiveness in the advertising business. In digital commerce, we continue to create synergies with the TV ad business and with our other Wellbeing activities and in Health and Wellbeing we will continue to build attractive high-margin verticals.

So, all of this, fundamentally designed to ensure a strong and competitive TV business model for the future. With this, I would like to hand over to Dr.

Gunnar. I think you should enjoy his presentation.

It will be his last for us and I would like to thank Gunnar for all his contributions and Gunnar please take over.

Thank you Thomas and good morning and welcome from my side as well. As always, let me take you through the performance for 2016 first and then talk about the outlook for the year 2017.

Starting on Page 15 of the presentation, let’s first look at revenues. As already mentioned, 17% so another dynamic year, exceeding our guidance of 15%.

I’m also very happy with the 10% recurring EBITDA growth. This is more than €90 million in absolute profit increase and we finished the year at a margin of 27%.

So again, a continuation of mix effects as we grow our digital production portfolio. Page 16 takes a look at the below the line items.

We have seen a slight improvement of the financial result driven by some improvements of the [indiscernible] result plus lower negative impact of valuation effects compared to last year. All this translates into a nice underlying net income growth of 10% to €513 million for the full year.

Let’s look at the segments in detail, starting with the broadcast segment on Page 17. I’m specifically happy about the 3% growth in Q4.

As you know, we were a bit cautious at the capital markets day, but we’ve seen a good outcome of the year, so 3% growth both for the fourth quarter and the full year and a nice transformation into recurring EBITDA. Full year number is €760 million, so another increase well in line with the revenue increase and as in previous years, we’re able to continue to enjoy a very healthy margin leading the peer group.

Before we go into the other segments, let me please take a look together with you on Page 18, because one theme has been very important throughout this year and that was the topic of organic growth in the digital businesses. We had many discussions in previous results calls and as you can see on that page, the guidance that we gave for the full year was 10% and I’m very happy to confirm that we achieved that guidance.

You also see the seasonality pattern in the full year 2016 with close to flat organic growth in the first half, and I’ve also given you the effects that we have discussed previously. And then the strong recovery of the growth in the second half, 15% run rate and that’s also what we expect for 2017 and you saw the chart in Thomas’ presentation that highlights the large number of very healthily growing assets in our portfolio.

So, with this, let’s look first at the digital entertainment segment on Page 19. A healthy growth of 19%.

There is one technical remark that I have to make, the quarter 4 growth of the AdVoD business of 17% is slightly impacted by a distortion in the baseline 2015, we consolidated four months in the fourth quarter 2015 due to the first-time consolidation. So, the underlying growth would have been much higher at 33% for that fourth quarter.

PayVoD/maxdome has also developed at 17% year-on-year for the full year basis and the adjacent business as already guided in the previous quarterly calls had a very tough year, close to 40% decline. Good news is that we’re probably going to lap most of the negative effects in 2017, so there will be one drag factor that’s going away as we go into 2017.

And for the games business, you know that we have successfully transformed our own operation into a minority stake in Gamigo. Let’s look at the digital ventures and commerce business on Page 20, please.

Very strong growth contribution both in relative and in absolute terms, 65% year-over-year. Online dating obviously only coming in the fourth quarter.

Online price comparison with very strong growth rates. Travel as well driven by Etraveli.

And then if we move further down, more than 100% growth rate for lifestyle commerce and a slight negative growth for SevenVentures. As already previously mentioned, we had some very tough comps in the second and third quarter, and we also did transfer one mature customer from SevenVentures to SevenOne Media, which also had a slight effect on growth rates.

Content production and global sales on Page 21, is a real success story from my perspective. I’m very, very happy with the outcome.

It’s the best year the content production group has had. We have well achieved our margin target.

If you look at the €47 million recurring EBITDA contribution for the full year, it’s sizable now in terms of the absolute results and it’s actually above the 10% margin that we have set ourselves for this business, very much driven by organic successes. And most importantly, the production Harry Bosch that we did for Amazon.

Looking at the full P&L and key metrics. You can see that we have delivered strong improvements top to bottom, slight improvement in non-recurring results 21% lower than 2015.

Again, as guided, slightly higher depreciation and amortization, largely driven by PPA effects related to the acquisitions that we have made in 2015 and 2016. And then the already mentioned improvements in financial result so that we see a reported net income growth of 14% and an underlying income growth of 10%.

Let me make one technical remark here as well. As of 2017, we will start to report our non-GAAP financials in a slightly different fashion.

We have historically seen some confusion on the fact that underlying net income did not contain non-recurring effects and recurring EBITDA etcetera. So, going forward, there will be a clean IFRS P&L, then an adjustment column and then an adjusted P&L and please get in touch with the Investor Relations team, they can provide you with a reconciliation and a pro forma view on the 2016 financials according to that new framework.

Referring to our non-GAAP KPIs, there will be no recurring EBITDA anymore, we’ll call it adjusted EBITDA and there will be no underlying net income, it will be adjusted net income as we move forward. So, finally a quick look at the balance sheet on Page 23.

As you can see we finished the year at €1.913 billion in net debt. This transforms into 1.9 times leverage over recurring EBITDA.

If you look at the effects that have been driving the development compared to year-end 2015, you see that our equity raise was pretty much in line with the amount of M&A spend that we deployed during the year. And that our free cash flow before M&A again came in at a healthy 48% cash conversion of recurring EBITDA and well covered the dividend payment for 2015.

There is one item in the other and discontinued operations to keep in mind. We did pay the €40 million tax for our discontinued operations in Sweden during the summer.

On dividends, Page 24, we’re happy to propose a dividend per share of €1.90, so that’s another increase of €0.10/6%. So the dividend yields based on year-end figures will be 5.2%.

As of today would be just south of 5% dividend yield, so I think another very nice increase. Again, a technical remark, the increase is slightly below the EPS increase because the dividend is going to be paid for all outstanding shares, whereas the EPS calculation only assumes the weighted average of number of shares across the year.

Pay-out ratio is close to 85%, so well at the midpoint of our dividend policy, and needless to say this is our proposal; this still needs to go through the AGM. I would like to close the presentation on Page 25 with our financial outlook.

The Group revenue growth is going to be at least high single digit, above 2016, and a healthy portion of that, clearly more than 50% is going to be organic growth. Adjusted EBITDA and adjusted net income will look familiar to you, above prior year, as the same guidance as over the last couple of years.

And it’s also important to note that we will maintain our financial policy, so clearly, we will continue to honor our 1.5 times to 2.5 times recurring EBITDA financial leverage target range and a dividend payout ratio of 80% to 90% of underlying net income. With this I would like to close my presentation and back over to you, Thomas.

Thank you, Gunnar. I continue on Page 28 and I think it’s very good news that the TV consumption in 2016 was relatively stable even for the very young target group it was actually even a little bit better.

So, I think we’re in a pretty good shape; in contrast to other markets the German TV consumption is holding up well. In the next year, we will have additional upgrades to our TV panel, which are shown on the next Page to adequately reflect video consumption, specifically linear streaming and we forecast that this will be beneficial as well to our viewing time for the full year 2017.

The ratings on the next Page are not unusual and pretty much in line with previous sport years if you can see here for 2012, 2014 and 2016. Next page is illustrating again our leadership position and the German TV market.

On Page 32, I would say a few comments about ATV, the Austrian TV acquisition we did. Fundamentally it will help us to strengthen our leadership position, and we see opportunities for synergies in this market and feel that we are now very competitive with the publics ORFs [ph], which are also our main competitor.

On the next page, you see a few examples of our content. I think interesting is that only 10% overlap exists with Netflix, so in other words, 90% of the content we play on TV is completely unique and not covered by Netflix and that may be one explanation of many why the SVoD penetration is lower than in Anglo-Saxon markets in Germany.

For 2017, we have as well an attractive lineup for commissioned content, both new shows as well as returning shows. Specifically, The Voice of Germany and Germany’s Next Topmodel, which is performing as well in this year very well, especially if you take into consideration the many years this show is already on, it’s a good example that some of the TV shows can be really very long lasting.

And we bring obviously as well the biggest new U.S. hits to Germany.

We have some pretty good new series and blockbuster movies as usual and returning seasons like Blindspot and specifically Criminal Minds. We continue to digitalize our TV business by launching new apps, the ideas are shown on Page 36.

And Page 37 is showing how relevant digital distribution and digital offerings are, you can see here the incremental reach we achieved through some of our online and mobile offerings. I think the best example is again Germany’s Next Topmodel, that we have seen 71% increase of reach.

For most attractive shows, I think 20% is a good number more or less to be added as a reach point, and it shows that our strategy to broaden these offerings is well justified. Speaking of new offerings, next page is showing you the red button, a product leading to the HbbTV platform.

Ultimately, I think this represents an enhanced consumer offering, increasing TV’s profile versus digital competitors and possibly strengthen the loyalty of viewers to TV and allowing them to really drive directly from TV consumption into the digital world. Next page is on kabel eins Doku.

This channel still needs to improve a little bit. It’s tune in, but if people tune in and watch the channel, they seem to be pleased and it shows that the channel has a potential for some of the shows, between 1% and 1.5% and given that we can broaden distribution, can improve tune in, I still think our original targets for this channel are well achievable.

An important step for us was on the next page that we agreed to launch four thematic windows with Scripps Networks. You know Scripps is very successful in the U.S.

with these types of channels, home and gardening TV, do it yourself, food network and travel. We will start in 2017 and the benefits for us are illustrated on Page 41.

I think this is unique lifestyle content for premium target groups. These types of content you find very often in print magazines and you know one of our strategies is to continue to attack print, and to move advertising share into TV from print.

I think these types of programs can certainly help us. When we look at the U.S.

viewer numbers for these channels, we see that the viewers are very loyal and extremely low time shift usage. Low time shift is anyway not an issue in Germany, but it shows that the people really want to see these types of programs.

And coincidentally we believe that lot of the themes captured in these windows are very relevant to our digital commerce activities and we hope for synergies there. Red Arrow is making a good progress, I think Gunnar has mentioned the grid financials, but strategically very important for us as well to continue to push our own your grid strategy.

Now the share of commissioned spendings done by Red Arrow is up to 12% from 9% in 2015, and some of the format highlights you can see on the right side of the page. So, the formats we air, really perform well in the German TV context.

Page 43 is showing that numerically in terms of KPIs that Arrow continues to improve and as part of our strategy, we continue to expand our footprint in the U.S. market as in previous years and you can see here the new additions to our portfolio on Page 44.

What makes Red Arrow unique apart from very good creative collaboration and the continuation of the producer brands in the market, is that we really have a diversified slate of shows, selling to more than 200 broadcasters and platforms worldwide. So it’s in my opinion a less volatile business compared to others and the blockbuster risk is lower than for other product networks.

So I think it’s very wise that we continue this strategy and continue with our bolt-on M&A activities. Page 46 shows a few shows which are successful globally.

We are very proud that we signed a new Bosch deal with Amazon. It’s now one of the longest running original drama series on Amazon and now season four is basically in the making.

The outlook is that we continue to strengthen our core channel, that we will launch the thematic magazines, windows and potentially channels, which are corresponding well to our e-commerce portfolio. We will continue to develop innovative multi-channel consumer offerings, targeting millennials by addressing some of their new viewing needs.

With digital offerings, we continue to leverage Red Arrow and we will use TV to drive data access, registrations and reach. Let’s move now to the advertising market, let’s go to the summary on Page 49.

Continued solid TV advertising market growth; as I mentioned before, we are performing slightly below the TV ad market. TV is increasing its share of the media mix at usual at the expense of print.

Positive pricing development continued and we have seen a growing number of addressable TV campaigns. Page 50 you see the German ad market growth development over the last years and it’s fair to say that more or less between 2% and 3% seems to be a good number if you take a look at the last four years.

As mentioned by Gunnar, we were a bit cautious in October, but we have seen a strong rebound here in the final two months of the year, ultimately delivering the forecast we have given you early in 2016. Page 52 shows the different segments.

Again, please keep in mind that not all digital segments are here reflected. Clearly the other segments are – it’s very cannibalizing print.

It’s not TV alone which is gaining from the print decline, but as well some digital segments. The customer development according to customer size groups, you can see on Page 53.

I think for us it’s important that customers like P&G take publicly a strong position towards TV and critical position towards the shortcomings of digital. That is a theme which we have heard several times last year and it’s good that we have now a more balanced discussion about the advantages of one medium over the other.

In the past it seems that people were really just seeing the advantages of digital and now they see not only the disadvantages of digital, they see as well the numerous advantages of TV. Page 54 is illustrating that most of the segments are indeed growing their share of TV spendings as part of the media mix.

We continue to be a leader in the German ad market as seen on Page 55. We have lost a little bit to public broadcasters, but again our lead over our main competitor is obvious and strong.

Page 57 is showing the continuation of the nice pricing development. You can see here the gross CPT growth.

Obviously on a net level it has been a little bit offset. But again, low-single digit to mid-single digit net price increase seems to be possible, in some years easier than in others.

For the future, it’s very relevant that more customers in 2016 decided to experiment with HbbTV-enabled addressable TV advertising and you see here the examples and it really becomes clear that these type of campaigns are driving more engagement and possibly really have a stronger impact on sales of our ad customers. The next page is showing you the development.

Currently we can do classical SwitchIn campaigns, we can do Red Button Spot Overlay. In the future, with HbbTV 2.0, set top box cooperation, IP livestream, a full screen overlay of Spot is possible and that certainly – multiply the opportunities of individualized and addressable advertising.

Page 60 is more systematically showing you the evolution of targeting opportunities to close the gap with digital competitors. In the past, basically we only had the broad audience targeting options.

Now we are basically in an IP-based opportunity space where options like geo-targeting are available to us. In 2017, cookie-based will add an additional dimension of targeting opportunities and as of 2018 onwards, we will have significantly better opportunities.

Then our targeting can – will be added through registration-based profiles, because then we have socio-dems and we can basically link TV and digital data in a very effective way, allowing our ad customers to do better and more efficient campaigns. Page 61 is showing you that we did even some first programmatic addressable TV campaigns and here certainly having an own AdTech stack is helping us and is giving us clearly a competitive lead over others.

The macro indicators signal robust economic growth in Germany. For our business it’s key that the macros are sound and in Germany especially, the unemployment rate is low.

I think that’s obviously a good sign going forward. When you take a look at next year, we have Easter a little bit late, so we expect a shift from Q1 into Q2.

For the full year, we continue to forecast a 2% to 3% growth for the ad market and we will be broadly in line with this. So the outlook, 2% to 3% ad market growth, be broadly in line.

We will continue to grow share. We will expect continuation of price increases and we expect [indiscernible] improvement in scaling of addressable TV and more usage by ad customers of this new opportunity.

In terms of distribution, another good year. Double-digit growth; HD subscriptions in line with our expectations.

I think the teams did a nice job in extending contracts with Vodafone, and we have secured a broad distribution presence. Page 68 is showing you the HD penetration, and 69 is giving you a few details about our contract extension with Vodafone.

Page 70 is a good overview of the deals we have signed in 2016. I think 71, it’s worthwhile to pause for a moment.

I think this illustrates best how much the distribution landscape of TV really has changed in the last five years and how broadly TV is available. So, I think we have basically secured to be present wherever TV can be seen – our channels can be seen and that’s a huge achievement.

Ultimately it will drive consumption, because there is always a correlation between distribution and consumption and that is one reason why TV is holding up so well. If the panel adjustments will be made, I think you will see that TV is clearly relatively stable and we will do our best to secure the continuation of a strong distribution platform.

On Page 73, you see the summary highlights of our digital entertainment business. Especially noteworthy is that we signed a deal with Studio71, our minority investment in Pluto, that maxdome was able to hold its position, that we launched a new marketplace called glomex, and let me explain our AdTech business.

The growth of digital entertainment is very dynamic. I think especially when you exclude adjacent.

You know that adjacent is basically our music label business and life business which is not so digital and is relatively small as a proportion of the revenue. The growth of digital entertainment, if you would exclude games and adjacent, would have been stunning, 50%.

Even the EBITDA growth of 80% is very positive. So, this gets overshadowed, basically, by the inclusion of games and adjacent.

So I think it was worthwhile to take a look at the numbers which truly reflect the portfolio of digital entertainment. Next page shows that our AdVoD revenues in Germany are growing well, 26%, driven by new apps and by our multi-channel network, Studio71.

Studio71 remains a leader in the German market and is the number four position globally, driven by, I would say, premium content with a large number of viewers per channel. Page 77 is showing you a little bit more detail about the deal we have done with TF and Mediaset.

I think most important is that the company, Studio71, was valued at €400 million, which I think is a good valuation given as well when you look at the valuation of other companies. The business model for multi-channel networks is a challenging one, but I think we have identified six levels how to further improve profitability in addition to internationalization and teaming up with partners.

When you see these initiatives, I hope you will share our optimism that this business will be profitable by the end of the year and going forward. 79 is showing you the positioning of Quazer/Pluto.

In the digital video market, we have a strategic minority investment in Pluto, basically a new generation of online linear streaming with clear focus on factual content which we believe is in high demand those days. Maxdome dynamic subscriber growth, more than a 1 million now, the top 3 position, strong local partner of choice as is illustrated on the right side of numerous collaboration agreements.

We have launched our first original German series called jerks. The press echo was great and I think that is very helpful for the image of maxdome.

We added now a spell on Prosieben and it had a solid start. It’s kind of a cultural and every channel needs this type of shows to improve the image.

Next page is the extension of the Unitymedia cable partnership, and I think that one key element of maxdome’s strategy is the deep integration into some of the distributors’ products. That is something our competitor is not doing at such an integration level, and it will certainly continue to ensure certain distribution, which we need for maxdome.

But we will continue on the next page with B2B. We continue to cooperate with – and create own IP, especially with Red Arrow, and we will sales force to create for maxdome additional advertising avenues.

The market penetration of SO remains to be lower than in other Anglo-Saxon markets, but again for our TV ad business it’s a positive. For the SO it’s not so great, but I’d rather prefer the TV advertising remains healthy.

Next page is showing you the business model of a content marketplace. Our brand glomex is developing here a nice position and has some attractive features like a tool how to circumvent ad blockers, and the share of ad revenues showing how in the total value chain the three participants most likely share the margin.

Our company Virtual Minds acquired ADEX, a data management platform, and now our AdTech stake is relatively complete. You can see on the next page that both us and our main competitor have decided to acquire and own AdTech, and the reason is basically to secure independence from global digital competitors, and to backing up our proprietary TV data in our own ecosystem.

I think you obviously have to protect proprietary data, and if you can do this with a proprietary ecosystem in theory it should really clearly enhance your competitiveness. Certainly we will be able to maintain transparency across the full value chain.

Page 87 is showing you the numerous data sources we will have, how these data sources will interact with our own data management platform and our own media buying platform, and how this will then translate into premium and unique data offerings for our key customers. You can see here that we have already a very sizeable data pool, and clearly we have to get more data and better profile data to increase the impacts for advertising customers, but we are very convinced that over the next couple of years we will really have a very attractive data pool.

One first step was a strategic cooperation with Zalando for audience-driven advertising, which you will see here broadly described on Page 89. On Page 90 you will see the idea behind – this is basically the combination of special targeting, together with the high quality inventory, together with native ad formats.

This will ultimately translate into very attractive ad products which are exclusively delivered through own tech platforms like Zalando’s Media Solution and our Active Agent. This is the set-up of the system and we are now collecting experiences, and we hope that this could be a footprint for further collaborations, and to give us learnings how to optimize our own data business.

Page 92 is showing you that only our competitor and us will be able to combine TV data with digital data, and obviously we believe we have a strong digital data profile based on our portfolio structure and our main competitor. But again this certainly for us and for our competitor as to say, a very good step in increasing our competitiveness in the overall ad market going forward.

We have to still work on single log-ins to drive registrations, and this is certainly a key driver of our ability to link TV and digital data that’s shown on Page 93, but we have numerous ideas how to develop this. But again this is every day hard work to get the data, and this is not done overnight.

This is really a multi-year program, but I’m very convinced that we will succeed here, and this will strengthen our competitiveness. Let’s move to Digital Ventures & Commerce.

On Page 95 you will the summary here. Very dynamic growth.

Strategic acquisition, minority acquisition of Kaeuferportal. Lighthouse M&A deal with Parship.

The Stylight acquisition had to finalize the buildup of Lifestyle Commerce. We started to build up the Wellbeing Ecosystem.

SevenVentures, despite the financials being not so great given the comms, had concluded some very attractive high profile deals. You will see here the growth rate on Page 96.

Page 97 is showing you now the portfolio of SevenVentures and Commerce, with the four key verticals plus Ventures. On 98 you see that our portfolio is really relatively balanced.

So we are not dependent on one vertical. I think the verticals are synergistic, but to some degree have enough independence to not be impacted negatively in a crisis by the other.

The next page is showing you here how we assess – or how we decide to invest in certain verticals. Only a few low fits here on this page, so we are very pleased that our verticals are fitting with our investment criteria.

The next page, 100, is illustrating again how we create value on our digital commerce operation side. Not all of these businesses have, by nature, a high margin.

But with our unique approach we are able to improve the margin and ultimately – to simplify this chart in a message, it’s the combination of advertising synergies, data collaborations, and strengthening basically our relationship with customers through a sales relationship. We believe that we can not only drive the margin of our digital commerce business, but that we can strengthen as well our advertising competitiveness.

So this model is very synergistic, and on the next page we have just listed for those of you who like operations an inventory of actions, how to create synergies. Actually they can be relatively sizeable if you execute them well, and certainly can help to enhance our margin profile.

The next pages, two pages are showing you how each of the verticals are contributing to the synergy potential, and you see that some verticals have a stronger impact on synergies than others, but all of them contribute to some degree to some synergies, and if you add all this up, this will be very attractive. So let’s take a look now at some individual segments.

Let’s start with travel. Travel growth is very dynamic, especially driven by etraveli.

We were able to stabilize our packaged tour business in a difficult market, and had very successful revenue growth trends for Billiger-Mietwagen and mydays. When you analyze our different companies in the travel vertical, you see that we have strong positions on – but not on every company.

We have received some indications of interest from the market. That’s why we have decided, when you get interest from the market, to start a strategic review.

Obviously the outcome is entirely open, but we see now that we have a duty that might make sense to review composition of this vertical strategically. Just to close on travel, the etraveli numbers are really very impressive, and this business will continue to do well.

Verivox was driving the OPC performance. I think in quarter 4 from the growth rate we had as well the effect which Gunnar mentioned, that we had in the last year four months into the last quarter.

That’s why the growth rate in the last quarter was not so compelling. But generally the underlying growth rate of Verivox is very dynamic, and we believe that Kaeuferportal is a very meaningful complementary platform, which ultimately can deliver as well synergies for Verivox.

The synergistic play we have started you’ll see on Page 108. You can see the different verticals of Verivox, and if you look at TelCo, OTA and Car Rental, you will see some familiar names of our portfolio, which we have in a dual branding strategy as well as integrated in Verivox, thereby achieving scale and driving incremental revenues.

Parship and ElitePartner are the two most successful matchmaking brands in Germany. They have more than 80% share.

Parship is more, I would say, the number one in the overall matchmaking. It’s basically a platform targeting almost everybody, where ElitePartner is clearly positioned in the premium segment.

Both companies have a strong foundation, especially the technology leadership where 16 years of experience is very convincing. There is still potential for further market penetration, which you can see on Page 111.

If you compare the bottom of the left side, Germany and the U.S., you will see that there is potential. But there are as well additional growth opportunities like synergy potential with Lifestyle Commerce assets, the expansion into business segments – adjacent segments, and to expand into relationship internationalization of business model, and ultimately it’s always possible to consolidate the dating market.

Lifestyle Commerce is performing very well. Growth-wise you can see on Page 112 the dynamic growth rates on the right side.

Page 113 is illustrating our ecosystem, where we have the combination of TV, platforms and products. There are still some white spots here, but overall I think we have almost in every important vertical here full coverage of the complete ecosystem.

Windstar is our anchor asset in the OTC with high synergy potential, for example, with our minority investment into Vitafy. Here we believe we can further grow the business in the channels where they are currently present.

Amorelie is transforming itself from a sexual awareness company into a sensual lifestyle brand. They have launched nine platform brands in the last two years, and they are as well driving offline sales with their Amorelie Toyparties.

I think this company has certainly a lot of growth opportunities. The Stylight StyleLoft on Page 116 is showing you how we create synergies amongst the Prosiebensat group, combining really TV assets, production companies, commerce properties, engagement platforms, and webstars.

SevenVentures, here you can see the number of high profile deals we have concluded in 2016. What is interesting maybe for you is on Page 118 that we try now to set up a more balanced portfolio, balanced in a way between digital and physical products, and between growth stage and early stage products.

I think the investment risk on physical products is significantly lower. On the other hand, the upside potential on digital products is still very attractive.

We are a little bit more cautious on very early stage investments in digital, because there you have occasionally an impairment risk. But if you balance the four buckets here well, I think in the mix calculation you will have an attractive business going forward.

Let me close with the summary on Page 120. Our outlook is – continues to be very positive, at least high single-digit Group revenue growth, TV ad market to grow between 2% and 3%.

We will grow broadly in line with market. Digital Entertainment and Ventures & Commerce will grow double-digitally.

Our adjusted EBITDA and adjusted net income will be above prior year. The positive, we will have certainly positive dividend outlook, and our dividend policy will remain unchanged.

With this I would like to open up for Q&A.

Yes, good morning everybody. My first question is you said you’ve made a good start for the first quarter of 2017, so can you tell us what you mean by that?

Maybe some color on TV advertising in January and February, and then on the other divisions? That’s my first question.

The second one is on travel. You said you received expression of interest for travel, so you had to look at the offers.

I know you probably can’t tell us much, but what would be your preference between one, keeping the assets, two, selling everything off, three, partial sales? That’s my second question.

On the programming gaps difference between income statement and cash flow statement, was €77 million in 2016, can we have some color on how big it will be in 2017? Thank you.

Let me start with quarter 1. It’s too early to – and actually not really meaningful to give too much color.

I would just say the start really supports our full-year guidance. That’s very simple.

We have seen no major deviations from our original game plan. In terms of travel, the stupid answer, it depends.

But maybe just to clarify for you a little bit the scope, I think mydays is part of the travel portfolio which would very well fit into our Lifestyle Commerce platform. So this is certainly an area in which I think it’s better suited to remain in our portfolio.

Billiger-Mietwagen can remain in our portfolio because it’s very well integrated as well into Verivox. So here we are completely open-minded.

It can go both ways. Wetter de, which is part of our travel portfolio, is indeed more an advert property and it’s kind of relevant for our ad sales online.

But there you should assume that that remains into our portfolio. Fundamentally the core of the strategic review will be around etraveli, weg.de, and tropo, and Billiger-Mietwagen, it depends.

Gunnar, I know that you are very keen on answering the – it may be your last answer on the program gap for ProSieben, so enjoy it.

I will. Julien, first of all the number is approximately €60 million stock increase in 2016.

I’m always a bit nervous on the term gap, because it has a negative connotation. The fact of the matter is we need our stock and we need the growing stock in order to conduct our business.

If you look at the gap, the largest relative increase is coming from digital entertainment and Red Arrow, and obviously building an IP base is the foundation for our Red Arrow growth. The same applies to digital entertainment.

We’re looking at healthy double-digit margins for the video business. We need program to support that.

So there must be a structural increase of our program library. Also for the broadcast business, we’ve seen an increase this year, and again that relates to investments that we’ve made for additional U.S.

licensed content, some premium deals that are beginning to flow in. So I’m absolutely happy with the development of the stock.

Let’s keep in mind there is two things that we look at. One is there is a theoretical optimum of our program stock, and we continuously monitor whether we’re in that range or not.

I can confirm that we are. The second thing is that obviously our management team and our auditors look at the quality of the stock, and I can also confirm that we have the best quality stock at December 31, 2016.

So for next year it’s safe to assume a continuous increase in line with inflation for the program stock as well.

Thank you.

Hi guys. First question is just on acquisitions in digital and adjacent.

I know you probably want to stay fairly sensitive here on specific targets, but it’s now been four months since the capital raise, so can you just help us with whether you’re thinking about new verticals here or strengthening existing ones, and your preference for geographic as opposed to vertical consolidation? That’s the first question.

The second question is just on the organic margin in digital and adjacent overall. You’ve given that 10% organic growth number in revenue terms, and 15% guidance for 2017.

What would be the margin if it’s the organic margin in 2016? Was that up or down, and how are you seeing that in 2017 as well?

Just so we can get an idea of what’s been delivered by mixed effect and what’s not. Thank you.

Thanks a lot for the questions. I think – I know that you accept that I can be not too detailed in terms of acquisitions, but again as referred to in the chart in the presentation, we are basically thinking about acquisitions in every vertical we have, in TV, in production certainly, in digital entertainment, and as well in commerce and ventures.

Here I would say clear priority is very much to focus on adjacencies to companies which work really well. So I think Kaeuferportal is an example where we have acquired a minority, and where we have an option to go to a majority, which fits very well with Verivox.

So first intention would be to look at what else can we do around Verivox. The next one is really Amorelie sensual lifestyle.

There are huge opportunities as well in the German-speaking market for this asset. The third area is the mydays gift business, there as well numerous opportunities.

The new verticals and geographic consolidation outside Germany is more challenging, so that’s why for a partial fee we would rather in the first stage prefer to do consolidation in the German-speaking markets, because that’s where we have the benefits, before we go international. So I think we have a clear game plan.

We would not like to be pressured to buy something. We are patient dealmakers.

Sometimes we wait for years to sign a deal. I hope this will be not so long with the money we have received from the capital increase.

But I think we have a lot of opportunities. With a bolt-on business you always – there is not this one big deal, and obviously you always hope that a big deal is coming up, which makes sense, but they are unfortunately very rare.

In terms of organic margin in D&A, I think that we have given you at some point in time the margin target range for 2018. For online travel it’s between 15% and 20%.

For price comparison it’s between 20% and 30%. Dating is 25% and 30%.

Lifestyle Commerce around 10% plus or minus 5%. Ventures by definition is a high margin business, so 50%.

I think ultimately when you net out everything and you just rely on organic growth, this is probably a target range which you can assume. To what degree this will be relevant for 2017, I leave it up to your modeling skills.

Thank you. I wouldn’t leave much store in that.

Just on 2016 though, how was the margin –how was the organic margin, actually, development there? Was it actually up or down if you strip out the acquisition impacts?

This is Gunnar, Laurie. If you look at the numbers, the margins have come down slightly in both digital segments.

That’s driven by mix effects again, but obviously especially for the digital entertainment, if you look at the chart that Thomas showed, that shows the growth excluding adjacents, you can tell that there was a heavy profit impact from the decline in adjacents that has weighed on organic margins. But also keep in mind in addition to the guidance that Thomas has given on the margin ranges, if you look at the performance of the acquisitions that we’ve made after acquisition, there is a strong expansion of not only the top line but also margins, which leads to that north of 8%, actually closer to 10%, free cash flow ROI on the acquisitions that we’ve made.

All that becomes obviously organic over time as well.

Great, thank you.

Yes, good morning everyone, and thanks for the presentation. A few more questions please.

Firstly on broadcasting, given that you expect 2% or 3% advertising growth, for the market and about yourself, what sort of operational gearing should we expect, i.e. what sort of margin expansion, if any?

Secondly, would you expect any weakness in Q3 or Q4 perhaps due to the elections? Thirdly, you’ve given us a target of 15% growth in D&A.

Can you give us a bit more details perhaps by vertical where you see the strongest possibility for growth, or perhaps the areas where you expect growth to be a bit on the weaker side? Thank you very much.

Okay, let me start with the last two. First with the growth rates, I think it’s pretty much in line with what we have stated in the past.

I think online dating is 10%, plus or minus. Online price comparison is between 15% and 20%.

Travel between 10% and 15% depending on things like terrorist attacks that you can never really know. Lifestyle Commerce, north of 20%.

SevenVentures between 5% and 10%, but again this is very – the high profitable growth. AdVoD north of 15%, maxdome north of 20%, and adjacent actually I would be happy if it’s stable.

That is certainly the one business where we have not – we have some ideas how to digitalize the business, how to recapture growth, but they need to be worked out. In all other segments I’m very comfortable that we have numerous growth ideas, and as usual some work out, some not.

But the adjacent business is the one where the options are limited, because the fundamental trend of services like Spotify and Apple Music is certainly having an impact on the music business. So this asset relates to digital.

Due to elections, yes, my God. I think – who knows?

Seriously. If I know the answer to this, I should do another job.

It’s really difficult. Honestly I feel, that’s more feeling, intuition, there is a certain, I would say nervousness in the market.

I think some people might not commit because Trump, who knows, Brexit, German elections. At the end they always book advertising, and they never are really seriously impacted by any kind of elections.

But certain caution is maybe in the market, but I don’t expect major impact on the ad business. Not in 2017.

Gunnar?

Okay, and then on the broadcasting operational gearing, I think the best modeling approach is if you just look at the past seven years or so we’ve had a very stable margin in that 32% to 34% range. As I said previously, expanding the broadcast margin is not an objective from my perspective, because we’re already operating – leading the peer group, and I think it’s important in that normal course of business to also allow investments into programming.

As I said, that’s the backbone of our business. If we were to see a much stronger ad revenue development, of course there would be some operational gearing, but in the normal course of business in that 2% to 3% range, please model a stable margin.

Very clear, thank you.

Good morning. My first question is on your audience share performance.

It looks like Q4 was a bit weaker and especially your ProSieben channel I think has been down about 5% in September. I think January was also a bit weak.

So just wondering if there’s any explanation, and how you plan to resolve that issue? Secondly is only online travel and strategic review.

Just wondering timing wise, do you think it is the right time now to sell parts of the business, given we are right at the low point in the cycle and multiples have come down? Also, if you do happen to sell parts of it, what would you do with the proceeds given you have also raised recently €500 million?

The third question is related to online travel. Where we are in terms of percentage of the revenue of the company spent on advertising?

Obviously that’s the potential de-synergy [ph] if you were to sell that asset. Thank you.

Maybe I’ll go with two and three, and then my colleague, Jan Frouman, will take over your first question. I think timing wise, yes, we might have a different view on timing.

I think we’ve seen actually some interest in the market, some multiples for some parts of the segments going up, not for every part of the travel segment, but if you think about mydays and flights, certainly the multiples have gone up. What to do with the proceeds?

I refer to the chart I have in the presentation. Just add something, and it increases our optionality.

In terms of percentage of revenue, obviously it’s very clear that when you sell such a business, the advertising has to be moderate on the rate the acquirer would have to pay. To give you an example, for etraveli, the business is almost ad-free as it relates to Germany.

So for that specific asset it would certainly not be an issue. As you know, this is most likely the most attractive asset which we have in the travel portfolio.

So I would ignore this element for a moment for travel. Jan, would you please take over the audience share question?

Sure, of course. I mean the primary softness related to ratings last year was clearly due to the sports effect, which is not going to be a factor this year.

Obviously we did see some slight erosion in some of the U.S. performance that is typically an underlying platform of ProSieben.

The good news is, the vast majority of U.S. product that we have on the grid is working and continues to work, whether it be sitcoms or films.

We have access to the top and most attractive shows that are going to be coming in this season, including This Is Us and The Mic [ph]. Our returning format highlights, whether it be The Voice or Top Model or now Kiss Bang Love, are delivering exceptional ratings, in some cases the best that we’ve seen.

We’ve obviously been very focused on our slate of originals. So we have high confidence that we will be able to come out of a softer ratings year and improve performance across the grid.

Just a follow-up on your recent content deal with Scripps. What level of cost inclusion are we talking about here?

Just a kind of rough guide.

I don’t think we’re going to get into the specifics of how much the deal cost. What I can say is it’s an extremely cost-efficient deal.

It has exactly the kind of content we were looking to secure, in that it’s mono-thematic and targets very specific audiences for very clear ad sales and commerce potential reasons. We see it fitting beautifully on the channels that we’re going to be spreading it across, and give us an amazingly attractive platform to launch new programs, which will speak to the audience that we know is on that channel in any event.

If you look at Scripps’ position in the U.S. market, they are far and away the leader in each space that we’ve stepped into a window.

Great, thank you.

Yeah, hi, it’s Marcus here. Coming back to Laurie’s question on M&A again, I’m just trying to find out what your appetite in terms of volume is in terms of sizing?

What is the right leverage amount from here that you would like to see, maybe taking – not taking into account any disposals here? That would be interesting.

Then secondly again on the strategic review in travel, I mean it’s not clear to me why now. Certainly you stated that you had offers for that part of the business.

I assume you get offers all the time on different parts of the business. Travel continues to go nicely.

You stated before advertising is a key element particularly in travel. So I’m not – I haven’t fully understood why particularly travel is the one you look at now.

Thank you.

Okay, with travel I think it’s always the combination of analytics and receiving offers. Here I think there is one chart in the presentation where I talk about the position of each asset.

Some of the travel assets are not really a market-leader in the sense that they have a relative market share of 50%. Some of them are not really benefiting and/or contributing to synergies as others.

For example mydays, Billiger-Meitwagen, fine. etraveli is a super asset going very well, but not really German country centric, and not really benefiting from advertising, and clearly not a market leader.

But a very, very attractive company with the super technology. So there you should certainly think about a strategic review if you are the best owner.

I think our job is to maximize value, and that’s how we see it. Again a strategic review is not necessarily saying we sell, but it’s saying we are reviewing it.

So I hope that that explains it a little bit. Gunnar, will you take on the first part of Marcus’ question?

Yeah, Marcus, on M&A really not much has changed. In terms of the volume we have at least €500 million in firepower.

In terms of the M&A strategy we will continue our string of pearls bolt-on strategy, so the size bracket that we’re looking at is that €50 million to €200 million, because that’s where we have businesses mature enough to be well integrated into our Group, but basically small enough to have a big impact for us in terms of the synergies in our portfolio. We will continue to focus on the German-speaking footprint predominantly.

In terms of leverage, we stick to the 1.5 times to 2.5 times that has served us very well and we’re perfectly at the midpoint. You know that we do de-lever structurally along with growing profits; we gave that number of €200 million to €300 million M&A firepower that we generate on an annual basis, so I think we’re very well equipped from a balance sheet perspective.

As Thomas said, we have a very solid set of investment criteria, both strategically and financially and we will continue to be very diligent here because that’s basically the foundation of those high returns that we’re generating with the existing M&A portfolio and we will certainly not rush or hurt any of those criteria as we move forward.

Okay, thanks.

Yes, thank you, good morning everybody. A couple of questions, first question, if you could just remind us on channel launch plans for 2017 and how much investment could be involved there?

Second question. In terms of your non-linear viewing developments in terms of the panel, the TV panels, you’re expecting a 2% increase, a 2% boost to TV consumption.

Do you expect that to be homogenous across the TV industry or do you think particularly on your ProSieben channel, with the younger demographic, that you could benefit more once that online and app viewing is integrated in the numbers? Third question, just on programming costs, could you remind us from what percentage of program costs are in dollars and what your hedging policy is?

Thank you.

So I’ll take the second and then Gunnar the third and Jan will explain to you more details on our channel launch plans. I think for the panel, just for clarification, the 2% would happen if nothing else would change, so obviously you never know, some things can even get better and some gets worse, but the panel sector is 2%.

Then you are perfectly right, the channels with the younger structure, that is not only ProSieben, it’s as well Sixx and others and ProSieben makes – will clearly benefit more and we see as well that the shows which got picked up specifically by catch-up are very often ProSieben branded. I think Jan and Christof are working together on new opportunities, how to leverage the potential of ProSieben with the digitally-minded audiences even more going forward with innovative offerings.

Gunnar, before Jan, can you take the hedging question?

Sure. So Conor, the U.S.

dollar denominated share of the cost is approximately 60% of the total spend. We have a bit more than €3 billion total outstanding contractual commitments in our planning and we operate at a 75% hedge ratio of seven years out, which has served us very well because you need to keep in mind that due to the interest rate differential, we’re able to hedge at much more attractive fallout rates today than current spot rates.

Then with respect to new channels, I mean we’re always opportunistic and looking at ways to enhance the value of our portfolios we’ve done with those channels in the past. It may very well be that some of what we’re doing in the window space will present opportunities to go deeper and launch a channel and attack print and be more focused on certain target groups and enhance Sat.1 Media’s position in the market.

But there’s no immediate plans as of today; we’ll take it one step at a time. If we were to launch it, we would expect the cost to be similar to prior channels, which would be in the low millions range, let’s say €10 million plus, €10 million to €15 million.

Great. Just one follow up question on your strategic view of your online travel assets, if you take slides on page 102 and 103, according to that, your assets in travel generally have medium to high synergy potential.

Does that mean that for the remainder of your assets, for those assets that don’t have high, specifically high synergy potential, that over time if the opportunity is in the market, that you could also look at offers for them as well?

Yes, that’s a good question. I think you should take a further look at Page 105.

You should always look as well at the competitive position in the market and the combination of these two, plus can you create outstanding value from the outside, that is giving you the answer. So I think we are not married forever with any asset.

There are some core assets where the bonding is very strong, but you know we are always open-minded and try to serve the shareholders’ best interests. So please, take those two charts and combine it with the competitive analysis in each vertical.

I would say the challenge with the evaluation with it here in the travel segment is that some of these assets really have high synergy potential and others have almost none. The medium is sometimes a mix of the portfolio FX and then you think about how we think about travel, that some of the travel assets will certainly remain in the group, almost with definite certainty, like mydays and others are better to be reviewed or there is more reason to be reviewed, then you have your answer.

So always challenging when you have such a heterogeneous vertical like travel. It’s a much simpler answer for Verivox that I would say everything is fine, strong volumes with the company.

Okay, great, thank you.

Thank you.

Good morning all and sorry to see you go, Gunnar. Two quick questions, the first one is slightly tricky I guess, but if you had known about the expression of interest on the travel assets back last year, would you have done the write issue?

That’s my first question, because you haven’t really spent anything, or not much in four months. The other question is, I know it’s hard to give a guidance, but where do you see the Hbb and I would say a digitally-driven ad revenues developing, let’s say, in one year, three years, five years from now, just to give us an idea of how much all these efforts and initiatives are contributing to your vision of the [indiscernible] business growth?

Thank you.

All these what-if questions, no? Certainly we always have an M&A as well a [indiscernible] chart, which is valuing your pipeline and valuing your disposal potential.

Probably would have still done it. Clearly because our pipeline is potentially huge and at the end of the day we felt that we want to prepare for leveraging all the opportunities based on our very strong cash flow return on investment.

But again, it’s a difficult question. I think we were not excluding the opportunity that this might come but you remember we always said we don’t want to be a bad seller by being forced to make money through a sale.

It was always consideration of doing the capital increase and that’s again a big fear. We have not decided to sell travel; we have decided to just do a strategic review.

In terms of HbbTV and how the buildup will develop, first of all our sales force is always very conservative. Secondly, we have always slow buildup in technology until you reach a certain inflection point.

I would say we will basically see here a range in 2020 between around €50 million, it’s certainly possible, plus/minus. How this will be built is open.

Best case scenario, by 2020 is maybe €100 million, worst case is €50 million. I will give you more guidance at the capital market day when we see now the adoption rate and then they have a better judgment when the next generation of HbbTV is developing and we have, as well, to see how our own data registration initiatives are progressing.

If we are able to conclude more of the [indiscernible] ideas, because here is the question of availability of new technology, adoption of new technology and availability of data. I think the customer interest, that’s for sure, I think we just have to make sure that the enablers are developing nicely and again, between €50 million and €100 million, more to come at the capital market day.

That’s great. Thank you very much.

Good morning everyone, just three questions from myself. The first one is just on Red Arrow in terms of the margin progression, obviously that’s quite pleasing with numbers coming up.

I don’t know whether you can give us any sort of feel or guidance in terms of where you think that business can go in the future. The second question just comes back to this strategic review that everyone seems to be focusing on.

When you bought Etraveli, can you give us some numbers around that business? Obviously there’s been a step up in growth rates because of the acquisition last year, it would be great just to try and get some individual numbers around that asset if that was the one that was really under review.

Then lastly, in terms of just cash flow out into 2017 in terms of financial liabilities, in terms of the put liabilities related to some of the M&A, just if we can get a timing of potential timing of those puts and what is the gross amount on the balance sheet at the moment?

Okay, I think Gunnar will take question two and three and Jan might start with Red Arrow and then Gunnar will take over.

Absolutely. Obviously we’re very pleased with the margin progression that we had, especially in 2016.

It is worth noting that we did have some exceptional business activity, including the Bosch series deal with that did with Amazon. That being said, as we’ve always stated in the past, we expect our margins to be absolutely consistent with industry comps and in some cases better, as we’ve seen this year and we have no reason to change that guidance, particularly as we look at the balance and strength across the portfolio.

Sorry Jan, just to follow up, should we then assume that 13% is a bit of a high watermark this year because of the Harry Potter deal with Amazon or do you think that’s sustainable?

I think it definitely has an effect. It’s hard to say at this point in the year, given that productions get picked up of size, distribution deals can obviously influence that, we tend to give guidance at more of a 10%, low double digit level, but upward from that is always possible, as we demonstrated this year.

Thanks.

Okay, on that strategic review question, etraveli, when we acquired the company was just south of the €100 million in revenue and it’s a low to mid double digit profit contribution for the Group, because you have seen in the presentation that we’ve seen very healthy growth, not only on the top line but also bottom line. On the put liabilities, year-end balance was €362 million and it’s important to note this is completely put liabilities, there’s really no material earn-out components left that sometimes gets confused, so there’s always an equity component that’s going to be transferred against the payment of these liabilities.

In terms of the timing, we’re expecting about €60 million to materialize in 2017.

Thanks. What’s the remaining timing of the other €300 million?

If you look at the capital markets day presentation, we did put down a note that there is around about €50 million to €60 million per annum of fluctuation and the final payments are going to be made in 2022 from today’s perspective. There’s another peak in 2019.

Yes, that’s what I thought. Okay, thanks.

Hi, good morning, thanks for taking my questions. First question regarding Parship, used to be a large customer in TV, now since Q4 you consolidated the company.

We understood you give or you pay some discounts, which will be the impact of Parship non-consolidated on the TV advertising revenue? Second point on the programming cost for the U.S.

content in local currency, maybe you can give us a color of the increase of the prices in the last year, what you expect for the next year. My last question is regarding the ATV channel in Austria, which cost synergies you could reach with this acquisition?

Last but not least, regarding the Zalando deal, maybe you can explain a little bit on the economics of the deal. Thank you.

Okay, let’s start with Parship. I think the Parship, let’s be reminded that in the past they spent some money with us and some money with competition.

Obviously one of the benefits we have is to internalize the money they have spent with competition. I think on our share of market, it would certainly be an offsetting factor.

We will regain probably some viewer share of advertising because of the absence of sport and obviously this will be offset by share loss due to the internalization of own spending of Parship, as our own group. So that’s why we guide basically that we will develop more in the sport in line with the market, because there is this offsetting factor, but this offsetting factor is maybe 0.5% and less.

But again, no sports here, so it will level up. In terms of cost synergies with ATV, I think we at this moment are not disclosing those, but again, let’s not forget, these are small operations in Austria, I’m not sure this would be shown up on the left side of the comma in your calculations, so it’s almost immaterial.

But it certainly makes the deal for us economically attractive. In terms of Zalando, we don’t disclose the economics of the deal.

Program costs, Gunnar?

Yes, Sonia, like I said to that earlier question, we operate at a very high hedge ratio. As a matter of fact, in the earlier years, the hedge ratio is closer to 100%, so we make sure that we are not at all exposed to U.S.

dollar fluctuations and as a result of that, there has been no material FX impact. As I said, we’re still enjoying very attractive hedge rates in our contracts.

In terms of general price inflation, if you look at it on a deal-by-deal basis within the individual deals, there’s not a massive inflation. Of course, as I said, we have taken some premium U.S.

studios on board, which is great content, as Jan already elaborated. So there may be some cost effect associated with that.

But let me again reiterate what I said earlier, we’re operating at that benchmark leading margin and everything that you see on the programming side is very well in line with that fundamental framework.

Thank you.

Good morning. My question is again about the ventures and commerce for the full year.

So just if you look at that in, let’s say, five years’ time, how many verticals do you think you will have and how many of those will be the ones that you have already today? Then maybe have you seen already interest for some of the assets in other verticals from certain buyers at this stage?

My second question is on maxdome profits. I think you’ve previously mentioned that once you’ve reached one million subscribers, you would be break even, so if you could just comment on that.

Then thirdly, TV ad market share, shall we expect for 2017 maybe a similar level to what you had in 2015? That’s it, thank you.

Okay, maybe let’s start with the ventures and commerce vertical strategy. You know that we try to basically level digital commerce to strengthen our TV ad competitiveness.

I think we have more than, I don’t know, 50 advertising segments and obviously not every advertising segment has a strong digital representation. But you can assume whenever there is digital commerce vertical, that is relevant for some of our advertising customers; we will look into an opportunity to enter.

The opportunities to enter can be just a collaboration on data, can be media for equity deal, can be a minority or can be a majority. We believe we have already selected very good verticals.

We are already where we want to be. I think in the space where we have seven wellbeing products specifically, healthy food for example, where we have Vitafy, then we have for beauty and such things, Flaconi, there are still some areas where we are not yet present which we might look into it.

So I would say ultimately maybe we can handle something like 10, 12 verticals, so we are already almost weighted at 15. But don’t assume that we always buy.

For example, the Zalando agreement for us is already very helpful just in the fashion segment. We will not certainly buy a platform which is selling or buying and selling fashion now.

But it’s a core element of our strategy to strengthen our TV advertising segments. In terms of assets, yes, there are always some assets which are attractive for others, but don’t expect me to talk about them.

In terms of TV advertising market share, I think when we say we are growing broadly in line with the market, I think that should give you an idea of what our market share is and will remain, so don’t expect major changes there, certainly no decline. Maxdome, I think before Christof gives you more color, I think we have already a year ago raised the number from 1 million to 1.3 million.

But maybe Christof, you update the audience now on you latest thinking on subscriber numbers because subscriber numbers are not the only driver for profitability. There is content cost, there is additional advertising income, there is our Tivot [ph] income, so I think it was maybe not too smart for us to just relate it to subscriber number, because we have to give you more color.

But Christof, maybe you expand a bit on this.

Thanks Thomas, this is Christof. Maybe to give you some more color around maxdome.

Of course it’s now with the million subscribers a very sizeable business already. But it’s not that just the pure subscriber number is the indication for the profitability.

We have added the substantial agreements with other B2B parties, for example also our new deal with Vodafone and Kabel Deutschland. It’s of significance for adding the product to their platform, so reaching more and more customers via maxdome in alternative ways which is not purely the subscriber number and we are adding advertisement to the business.

I think overall we can continue the guidance to say we want to break even this business in Q4 2017 and from there on, also on the full year in 2018 to run this as a profitable business. As it is running today, I think that’s on the path on which we are and which we want to continue to develop.

Okay, great, thank you.

Good morning guys, thanks for taking my questions. First question on advertising, I remember last year you sort of indicated that with the commitments that you had at the beginning of the year, most or the most sizeable part of your 2% to 3% guidance was already covered.

Maybe you could comment on how the booking season has been and maybe even elaborate on the trends that you’ve seen in terms of customers coming back, new customers popping up and strengthening of older clients. That would be the first question.

Second question on distribution, I’m just curious as what sort of expectations we should have for 2017 in terms of price increases. I think on the satellite side, the prices were raised I think some 17%, that’s on a full year basis, maybe you could talk a bit how distribution will be impacted and also whether the Vodafone deal on the pay TV side of that deal will be able to offset a larger part of the revenues dropping out from the lack of Sky.

Thank you.

Thanks for the question. I think the commitment development is in line with our plans.

I think you remember, reminded, that at this stage we might have covered 40% of our customer portfolio. That is not unusual; yes, I’m asking myself, my god, are we not yet advanced?

It’s really sometimes I feel we have a year-long negotiation season. The finalization of the agreement is followed by the add-on booking season, so for the moment, it’s basically more or less in line with our plans.

I think there are some customers like P&G who I fear are a bit leaning more towards TV; others like L’Oreal are a little bit less, so I would say more or less – I see more reassured what we see from the local customers. I think the international customers might need a little bit more time this year to evaluate all the uncertainties before they finally commit, but they all start paying already.

If you look at our guidance and how we feel about the start into the year, I think it’s okay. So I believe that you will see a usual commitment conclusion pattern like in the past and the start was okay.

So as I said, in line with our plans. Christof, if you would talk briefly about the distribution topic.

Yes, so the first thing on the satellite, the price increase that has been mentioned in the market to the consumers, it’s also a positive effect for us, since we also with our signal delivery to satellite, will benefit from that increase going forward, so it’s a very nice thing for us to see. Second thing, the cancellation or the non-continuation of Sky with our Sky – with our pay TV channels, we will see them on other platforms now, like on Vodafone and so overall, the Vodafone going forward agreements and Kabel Deutschland will, I think, for the whole distribution business, offset the reduction in Sky on the pay TV side, so I don’t see any problem on that side.

Okay and one follow up if I may, sorry, coming back to M&A, when looking at price comparisons, this seems to be an area that you’re quite bullish on in general, particularly in how well it does with TV advertising. Would you be open to look at say more generalist portals?

Are you missing the whitegoods consumer electronics sub-segment on the price comparison side or is that something that is not that much of an interest to you?

Yes, I would say consumer – look, these portals are always interesting because they provide a lot of data. They are enabling you to have discussions with advertising customers.

Some are less profitable than others, some are less growing than others. The biggest challenge for consumer electronics is that the exclusive brand business for these types of portals is very challenging.

So you can just ultimately remain for these types of portals, this generation platform, you cannot really provide great services and Verivox in the way on a price comparison. But it offers, for example, opportunities to enter subscription business.

It’s high margin, the business, so the profitability per customer is superb, the return you get. So I would not exclude it.

There might be some who could potentially fit, but it’s not super a priority.

Okay, that’s clear and maybe you could update us on the Verivox Prime, I think it’s called, business, how that’s doing?

Too early, too early. I think they have now developed an agreement with some key supplier, which is important because you don’t want to have conflicts with the key suppliers and the value proposition is very attractive.

We actually think about adding maxdome to the subscription service to make it more Amazon Prime like, to attract the value proposition, but that’s in the making, so too early to include it in our charts, but it’s a very active part of our business. So I would say promising, but really too early.

We’ll update you soon, as soon as we have some tangible data.

Very clear, thanks.

Hi. Sorry, on the online travel space, from memory I think you paid about 2.5 to 3 times sales for etraveli in 2015, is this kind of a multiple you’d be looking for in terms of exiting?

The other question is on your market share for TV advertising, with it not being a sporting year this year, I thought possibly you’d expect to maybe outperform slightly and regain some of the share from the public broadcasters. Why is that not the case?

Okay, let me just repeat what I’ve said in relation to the Parship question. We will gain certainly back something what we have lost because of the sport here, but because of the internalization of Parship now, our internal customers pay a little bit less than the external customers, this will be offset in the official reporting.

Obviously the value will be captured, but for the share of market, when you see the reports, we cannot add back basically what we have saved from them. So that’s the main reason.

It’s basically offsetting, so you can say we would have maybe regained 0.5 percentage point gross because of the non-event of sports and we will lose 0.5 percentage point of gross because of the internalization of Parship more or less, so it’s levelling out. Obviously when we sell a company, we rather like to get more than less than what we have paid.

Sometimes it doesn’t work out but as in our case, we have never sold basically a business where we had really, which was so attractive, like etraveli, we would have received less than what we have paid.

Okay, thank you.

Ladies and gentlemen, whilst this was the last question for today, I don’t want to close the session without having handed back to Gunnar for a personal remark.

Well thank you, Ralf. Indeed I’d like to take a minute, since this is going to be my - or this was my last analyst call for ProSiebenSat.1, I must say I’m proud to hand over the finance leads on this positive outlook that we just discussed.

I think ProSiebenSat.1 is very well positioned to achieve or exceed the 2018 targets and I think we’ve also talked about the balance sheet, which is strong and allows some further flexibility and opportunities. Ralf Gierig is going to look after finance as I leave.

He’s a very strong finance professional; I have a lot of confidence and trust in him and Ralf, best of luck. Then obviously on June 1, Jan Kemper is going to join, a great choice from my perspective, both professionally and personally and I think he’s going to be a good fit to the team as well.

Thomas, I want to thank you for the great support over those eight years. Thank you very much.

I also would like to thank Werner Brandt and the Supervisory Board for their trust in giving me this opportunity. It’s been a real honor to serve ProSiebenSat.1 in this role.

I also want to say a special thanks to my team, especially in this dynamic environment that we have operated in over the past two years. Always on, always strong, it was a real privilege working with these guys.

Then last but clearly not least, thanks to all you out there for the professional relationship with a good co-operation, it was very much appreciated and I’m sure we’ll be in touch. Thank you.